Japan Output Drops, World Trade Funk, Belt & Road 2.0: Eco Day

(Bloomberg) -- Welcome to Friday, Europe. Here’s the latest news and analysis from Bloomberg Economics to help get your day started:

  • Japanese factory output unexpectedly shrank in March, raising the likelihood that the economy contracted in the first quarter
  • That would complicate things for Prime Minister Shinzo Abe, who has to decide whether to actually raise the sales tax later this year, after canceling the hike twice before. Added to that, a record-long 10-day public holiday to mark the new imperial era has the ingredients to both fuel and damp the sputtering economy
  • The Federal Reserve is likely to see prevention as the best medicine in an echo of its policy prescriptions two decades ago. The U.S. economy likely grew 2.2 percent for a second consecutive quarter
  • The global trade funk is dragging on, with volumes falling at the fastest pace since the depths of the financial crisis. Meantime, the Trump administration may concede to a Chinese proposal that would give less protection for U.S. pharmaceutical products. On another front, here’s what’s at stake in U.S.-Japan trade talks
  • The kids of Generation Z are about to become the planet’s biggest consumer spending force, portending opportunities in the the U.S. and China. But retailers and brands in many developed nations with less robust economies aren’t cheering
  • Emmanuel Macron promised a new wave of tax cuts for France’s middle classes as he sought to placate Yellow Vest protesters and reinvigorate his flagging presidency. In a 2-1/2 hour news conference Macron also said France and Germany are on a different page these days but believes their divergent views on Brexit, climate policies or on trade talks with the U.S. are “fruitful confrontations”
  • The developed world’s most successful economy is about to take a sharp turn left politically as the strength of headline growth masks deep discontent Down Under
  • And Argentinian markets fell for a second day, with bond yields in distressed territory on doubts that President Mauricio Macri will be able to fend off his populist foes and win re-election this year
  • Here’s a quick recap of this week’s events in the world economy, and a look at data due in the week ahead -- including China PMIs -- from Bloomberg Economics

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